What if you didn’t sell your ideas… you licensed them?

In other industries it’s normal. Actors are paid for usage. Musicians earn royalties. Photographers and software companies license their work. You don’t buy the thing outright, you buy the right to use it. So why not agencies?

How much is an idea worth? It’s a bloody hard question.

For too long the answer has defaulted to time and materials. How many hours did it take? What’s the day rate? How many people were involved?

One of my clients is now testing the licensing model. And the results are seriously exciting.

Their client, let’s call them XYZ, needed a new creative platform. Not just a line, but the full package: tagline, strategy, big idea, and the production to bring it to life.

The agency charged around $80,000 for the creative and strategy. Essentially at cost (some margin baked in), with the commitment to keep going until XYZ loved it.

Then came the shift.

If the client wanted to use the idea, they would license it for one year or three.

XYZ chose three years.

They paid about $200,000 upfront for the rights.

When the time is up, they’ll renegotiate if they want to keep using it.

Production was handled separately and priced in the more traditional way.

The brilliant thing is the licensing fee went straight to the bottom line. Pure profit. And as for future licensing, that's going to feel like a serious bonus.

What I love about this model is how it re-frames the conversation. It forces the client to stop thinking about how long the work took, and start answering a different question:

What’s the value of this idea to us over the next few years?

And in a world being up-ended by AI and technological advancement, this feels like a super interesting way forward.